Quick Links

Common Self Employed Mortgage Questions

If you are planning to go self employed, newly self employed or a veteran business owner, there will still be lots of questions you’ll have when it comes to getting a mortgage!

So we’ve put together a few common self employed mortgage FAQ’s to hep you out 🙂

Do you have a question about a self employed mortgage?

If you have a question about a self employed mortgage that is not covered here, please contact us.

How many years do you have to be self employed to get a mortgage?

The short answer is any where between zero and three+ years.

The shorter the length the more niche and specific the cicumstances need to be and fewer options will be available to you.

0 Years:

This will tend to be for a very specific scenario such as a professional (doctor/lawyer) who is joining a practice as a partner. Some lenders don’t need anything more than a letter from the practice manager or accounts from the accountant as they are able to see the track record of the practice and able to make an assessment of income based on this.

1 year self employed:

For most people going self employed one year is the earliest you can consider before getting a mortgage. Be aware that you will be limited by the number of lenders who will lend to you, as this is still relatively niche. One important point to note, you will need one full tax year (April to April) of being self employed.

2 year’s self employed:

As soon as you are self employed for two years, the vast majority of the market will be avaible to you. There may be lenders (few in numbers) that may still want three years, but the probablity is you’ll have (if not all), very close to all the lenders avaialble to you.

However, from two years onwards, it can get more complex! Some lenders will now look to either take the lastest years figures, while other lenders will average them. So this is when you need to start thinking ahead and start planning!

3+ year’s self employed:

Quite simply you will have all the lenders available to you.

But remember while some lenders may choose to either average or take the latest years figures, lenders will also be looking at the history and track record of a business. They may question why there has been an increase or decrease in any particular year.

Remember you need to plan ahead!

Note:

Mortgage lending criteria does change so always speak to an independent mortgage broker to find out what’s possible for you.

What is a SA302?

A SA302 tax calculation form is quite simply a summary of your income that has been submitted to HMRC for a particular tax year and the tax paid. An easy way to describe it, is it’s a little bit like a P60 for the employed.

Mortgage lenders need to evidence self employed income and there are lots of ways that they can do this. However as every lender is very different and have unique lending criteria, they often vary in terms of the evidence they will accept. Some lenders will need accounts, accountants certificates and/or SA302 tax calculations and tax year overviews.

When it comes to SA302’s lenders now usually also want acompanying tax year overviews to confirm the tax paid matches the figures both on the SA302’s and the tax year overviews. This is becuase lenders realised and caught onto the fact unscrupulous individuals were able to manipulate the figures only later to change them.

How do I get my SA302?

You can get your SA302’s and tax year overviews by either:

Loging in to your HMRC online account and downloading the documents.

If you have an accountant, they might be able to do this for you.

Or if you are really struggling contact HMRC direct and request them. They will send the documents to you by post.

HMRC have been encouraging people to move away from contacting them for SA302’s and tax year overviews and have made it easier to obtain these through the above methods.

Self Employed Borrowing Calculator

Self Employed Mortgage Guides

[post-carousel-pro id="1935"]

Celebrating our success rates. Making you jump for joy

We believe in complete transparency and honesty at every stage. We publicise our success rates at different stages throughout the mortgage sales process, making sure you’re always in the know.

YOUR PROPERTY MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY DEBT SECURED ON IT.Barr Financial is a trading name of Benjamin Parry who is authorised and regulated by the Financial Conduct Authority. Our FCA Number is 506976. The FCA does not regulate some investment mortgage contracts. Barr Financial are also members of the NACFB (National Association of Commercial Finance Brokers). The Commercial Mortgage Sector is currently a non-regulated activity, as defined by the FCA. Therefore client protection is limited. The only recognised body is the National Association of Commercial Finance Brokers. The NACFB has established complaints and disciplinary procedures designed to eliminate unacceptable working practices amongst its members and Barr Financial subscribe to their standards.